Regulation by Contract: A New Way to Privatize Electricity Distribution?

In many developing countries, both governments and investors have expressed disappointment with the performance of recently privatized electricity distribution companies. This paper examines whether regulation by contract or a combination of regulation by contract and regulatory independence would provide a better regulatory system for developing countries that wish to privatize some or all of their distribution systems. It compares and contrasts some recent regulatory experiences of distribution companies in Latin America and India.